Regulatory Technologies are playing a significant role towards unifying stock markets with honesty by innovating in the wake of the online gaming regulations. India's regulatory landscape has made leapfrogging progress over the last couple of days to guard its citizens from the risks of online gaming, and more specifically online money gaming, which has evolved into a serious social and economic problem. The Parliament's passage of the Promotion and Regulation of Online Gaming Bill, 2025, acts to capture the government's initiative towards safeguarding citizens, particularly the youth and vulnerable sections, from economic loss, addiction, and fraud by unsafe online gaming services. The move not only aims at regulating the sector but also demands priority in ensuring public interest protection through good policy regimes.
By establishing an Online Gaming Authority, the Bill seeks to create a coordinated regulatory framework that deters illegal and money gaming-based addictive online money gaming. Prohibition of such services along with severe punishment in the form of imprisonment and hefty fines is a major deterrent against fraudulent activities that have caused huge economic loss and social harm to an estimated 45 crore people losing approximately Rs 20,000 crore annually. This legislative breakthrough is a sign of a wider sense of acceptance that sound regulation is essential to provide social stability and economic prosperity. Furthermore, the move is also reflective of the necessity to protect individuals from being victimised by financial frauds and addiction that can have a ripple effect on their investments and market sentiment in general.
Despite the promising potential of RegTech, implementation continues to face considerable challenges. Issues related to data privacy, technological disparities between urban and rural regions, lower internet penetration, lack of skilled personnel to manage sophisticated systems amongst others continue to act as a major hindrance. For instance, data suggests that slightly over 50 percent of India’s population has access to internet. Furthermore, ensuring compliance with data protection laws like India’s Personal Data Protection Bill is crucial in maintaining user trust. Besides these aspects, updating cybersecurity measures continuously is highly critical for preventing breaches that could undermine regulatory efforts. Addressing these challenges requires a collaborative effort between regulators, industry players, and technology providers.
Undoubtedly, India’s regulatory landscape is poised to become more sophisticated with the integration of emerging technologies such as blockchain, biometric authentication, and quantum computing. These innovations will further enhance transparency, security, and efficiency. For instance, today AI is enabling stockbrokers to detect real-time threats and even implement proactive defence mechanisms. With the help of advanced AI algorithms vast volumes of transactional and network data can be analysed allowing stockbrokers to make swift interventions. As online gaming and financial sectors evolve, so will the role of RegTech, making regulatory compliance more agile and resilient.
The adoption of these advanced RegTech solutions is an indication of India's commitment to creating a safe and transparent investment environment. To investors, this translates into higher trust, with the assurance that their investments are protected by technology-enabled protections against fraud, insider dealing, and market manipulation. Additionally, the legal framework enhanced by the recent regulation of online gaming complements the government's focus on social responsibility, contributing to the credibility of financial markets in India.
(Ashish Rathi is the Chief Operating Officer and whole-time director at HDFC Securities)
First Published: Sep 09, 2025, 11:20
Subscribe Now